Athen Apaquette

What should have rocked our world was a big yawner for investors. Yes I mean JOBS JOBS JOBS… the March non-farm payroll numbers came in at 103,000 jobs created.

Expectations were for 175,000 jobs.

Normally that would have scared investors and sent them running for bonds which means we would have had a nice dip in the interest rates, but here’s what happened… investors looked back to the super strong February numbers, and the January numbers which were revised DOWN 62,000 jobs, and discovered that we still averaged 202,000 jobs created on average per month for the first quarter. So the dip was treated as no news…

On Monday we got very bland Institute of Supply Management levels – a reading of 59.3% down from 60.8% for February, so again non-news.

We saw a small flight to quality this week due to the tariffs/possible trade war with China unfolding.

Investors are parking their money in bonds until this plays out. If there is no deal, that’s good for rates as investors will run away from stock and park their money until something shakes out.

If however, there is a deal made between the US and China then interest rates will go up because investors will pull their money out of bonds in search for higher yields since the storm (trade war) will have passed.

So remember when it comes to interest rates, the bad news is good for rates, the good news means higher interest rates.